Consumer Directed Health Plans (CDHPs) are quickly becoming a popular benefit option for U.S. employers. These high-deductible plans are one of the fastest-growing benefit options for employees. To explore their effectiveness, we conducted a study using the MarketScan® Commercial Claims Database. The study closely matched members enrolled in a CDHP to members continuously enrolled in a non-CDHP, and evaluated healthcare costs and utilization over three years. We found a direct link between CDHPs and lower healthcare costs. On average, CDHP enrollees incurred $457–$532 less per member per year.
But these savings might come with consequences. Utilization rates were lower among CDHPs for a wide range of services — including professional visits, lab services, non-maternity admissions, and prescription drugs — suggesting that consumers may be reducing utilization across the board as opposed to simply avoiding unnecessary care. Of particular concern, members enrolled in CDHPs were less likely to receive any medical care for their existing chronic conditions than were their non-CDHP counterparts (based on a review of eight common conditions — asthma, congestive heart failure, coronary artery disease, depression, diabetes, hypertension, low back disorders, and osteoarthritis).
Although the benefits of CDHPs are substantial, these arrangements need to be entered into carefully. It is important to recognize that a CDHP design could result in members not receiving recommended care — and that could lead to higher costs in the future. If your company currently offers or is contemplating a CDHP, we suggest that you consider the following:
- Educate enrollees so they fully understand and take advantage of their benefits, specifically benefits of covered preventive services.
- Engage CDHP members to ensure they are continuing to manage chronic conditions while enrolled in a CDHP. The study suggested CDHP members received less care for current chronic conditions and were less likely to be diagnosed with new chronic conditions.
- Recognize that each employee is unique, so a CDHP might not be the best choice for all members. Help individuals choose the right plan based on their current health and their healthcare plan history.
- Provide useful tools, such as cost calculators, to make it easier for members to access information on physician cost and quality.
For the full study on the impact of CDHPs on cost, utilization and care, click here.